The Car Tuning Industry is Growing... Yet Insurance Blind Spots Remain

Government Continues to Ease Tuning Regulations
Driver and Age-Restricted Special Contracts Not Allowed
Many Limitations on Emergency Dispatch Services

[Image source=Yonhap News]

[Asia Economy Reporter Oh Hyung-gil] "I am the owner of a camping car who recently experienced an absurd situation on the Seohaean Expressway. Suddenly, the car broke down and I had to stop on the shoulder. When I contacted the insurance company, they said emergency dispatch is not available for camping cars, and the Korea Expressway Corporation also informed me that towing is impossible because it is a camping car. I called a private tow truck, but they demanded 200,000 won. If the Camping Car Act was made, emergency dispatch should be possible. The insurance premiums are expensive, but emergency dispatch is not available, which doesn't make sense. Please make emergency dispatch available for camping cars before fixing the barn after losing the cow." (Excerpt from a post on the Blue House National Petition Board)

The government is accelerating efforts to revitalize the automobile tuning industry, raising concerns in the non-life insurance sector. Although the intention is to ease tuning regulations to establish a foundation for a new automobile industry, tuned vehicles are still in a 'blind spot' of automobile insurance, which inevitably increases consumer damage.

According to the non-life insurance industry on the 10th, the Ministry of Land, Infrastructure and Transport (MOLIT) has recently announced a series of regulatory improvement plans to ease tuning regulations. On the 6th, MOLIT announced a legislative notice for the revision of the 'Enforcement Rules of the Automobile Management Act,' which exempts tuning approval for power transmission devices, pickup truck cargo bed covers, lighting devices, noise prevention devices, and more.

In May, MOLIT allowed the installation of 'campers,' camping equipment, without changing the type of cargo truck and established standards recognizing tuning to low-emission vehicles such as 'hybrid tuning' (conversion from internal combustion engine to hybrid). In October last year, MOLIT also revised the 'Regulations on Automobile Tuning,' exempting prior approval and inspection for 27 tuning items including headlights, auxiliary air conditioners, and noise prevention devices, and relaxed installation standards for 12 items such as roof carriers and luggage carriers.

As tuning regulations are continuously improved, the number of tuned vehicles including camping cars is expected to increase.

The problem is that the impact of regulatory easing may be entirely passed on to the non-life insurance industry. A representative example is camping cars.

Currently, when a regular vehicle is converted into a camping car, it must be insured under commercial camping car or commercial van insurance, not personal automobile insurance. Driver and age restriction special contracts cannot be applied, and emergency dispatch services are also heavily restricted. Therefore, not only are insurance premiums expensive, but camping car owners frequently file complaints against insurance companies due to lack of coverage or services.

Insurance companies also refuse to underwrite most automobile tuning except for camping cars. This is similar to the reason for not underwriting interior or performance modification parts.

If a tuned vehicle is involved in an accident, insurance payments are not made. Generally, anything not attached to the vehicle, installed, or listed on the insurance policy is excluded from coverage.

Unlike general non-life insurance, insurance companies need to develop specialized insurance products for tuned vehicles, similar to separately subscribing to leisure insurance, but due to a lack of related data such as accident risk rates for tuned vehicles, developing dedicated products is difficult.

An industry insider said, "Although automobile insurance does not apply, tuning vehicle regulations are being eased without institutional improvements from the insurance perspective," adding, "If consumer complaints and dissatisfaction increase, insurance companies will inevitably have to bear more responsibility."

This content was produced with the assistance of AI translation services.